By Ted Shen
Not everyone has a price: three years ago, Bill and Sonia Florian turned down an offer of $70 million for their classical-music stations WNIB in Chicago and WNIZ in Zion, which occupy coveted middle-of-the-dial frequencies (97.1 and 96.9 FM respectively). But everyone ages, and two weeks ago the Florians, now past retirement age, ended their 42 years in radio together by selling their licenses for the stations (which simulcast the same programming) to Bonneville International Corporation, a midsize media company based in Salt Lake City. The transaction, to be completed in two months pending regulatory approval, is valued at $165 million in cash.
The sale has real consequences for music fans in Chicago: Bonneville hasn't announced its intentions, but it almost certainly will scrap the stations' current programming for something more lucrative, leaving the nonprofit WFMT as Chicago's only classical station. In my Reader cover story (March 12, 1999), Sonia Florian said she had no intention of selling, but last February she and Bill Florian gave local radio broker Jack Minkow permission to send out feelers to potential buyers. "Bill has always said he'll keep [WNIB] until he dies," says Sonia. She and two close friends "coerced" him into signing the agreement. "We really didn't have a choice, although neither of us cares about money all that much."
When Bill Florian started WNIB in 1954, the FCC granted licenses for free. But those days are long gone; the Florians paid $1 million for WNIZ in 1983. And the 1996 Federal Telecommunications Act (one of Al Gore's pet projects) loosened the rules for the number of radio stations a company can own, triggering the lust of deep-pocketed national radio chains for full-power independent stations in Chicago and other major media markets. In the consolidation frenzy that's followed, chains have been gobbling up local independents--particularly those with desirable FM signals--and as with so many other markets in the booming 90s, the sums paid for such stations have been astronomical. "A station in LA was just sold for over $200 million," says Minkow. "That's what the economics demand right now. The 'NIB sale is definitely the priciest ever for an independent in Chicago."
Yet the decision to sell was an agonizing one. Sonia Florian says she was concerned by the advent of "other means of getting classical music, from satellites to the Internet." With no children, the couple have no one in line to take over the stations, a factor that weighed heavily on her mind. "Should anything happen to one of us, we would be forced to sell. And that's not a good position to be caught in." This fall she underwent an emergency surgery, which friends believe might have deepened her worries. An even greater fear, she admits now, was the prospect of an economic slowdown. "We're likely to have a recession in the next year or so. If we waited, we might not get this kind of offer until 2003. Who knows? Classical broadcast might be obsolete by then."
Her fear was confirmed when one bidder, a publicly traded media giant that had dangled an offer of $171 million, backed out because its stock was tanking. She and Minkow immediately started talking turkey with Bonneville, the next highest bidder, which will add WNIB and WNIZ to Chicago holdings that include WNND (100.3 FM) and the high-rated WLUP (97.9 FM) and WTMX (101.9 FM). This takes Bonneville to the FCC's limit of five FM stations owned by the same company in a large market like this one.
Sonia's claim that she and her husband aren't interested in money may sound hollow coming from someone celebrating a phenomenal windfall, but the couple has always avoided ostentatious spending. Bill, whose only expensive hobby is motorcycles, is often mistaken for a janitor; Sonia, who sits on the Auditorium Theatre Council, indulges in occasional weeklong vacations. The Florians struggled for years, until the mid-80s, when they acquired WNIB's sister station, dramatically broadened their audience, and began to beat WFMT in the ratings. Now that they've cashed in their chips, they're trying to make sure their employees, many of them nearing retirement, are taken care of. "We're giving each a generous severance package," Sonia says. "And the Bonneville agreement has a provision to hire five people." She's meeting with Dan Schmidt, the president of Windows to the World Communications, Inc., to discuss the possibility of its radio station, WFMT, hiring some of WNIB's personnel. Schmidt promises to "help ease the transition. You're likely to see some of their voices and traditions finding a home here."
They're unlikely to find a home anywhere else: according to Bruce Reese, president of Bonneville, WFMT's presence in Chicago means that "neither WNIB nor WNIZ needs to remain classical." Asked about possible format changes, he says, "We'll have something with mass appeal." Because his company is owned by the Mormon Church, he rules out the prospect of shock jocks like Howard Stern. Bonneville has bought classical stations in San Francisco and Washington without changing their formats, but in the past decade the number of commercial FM stations playing classical has dropped by nearly a third, from 52 to 35.
Despite its management and budget problems in the early 90s, WFMT could celebrate a windfall as well if it winds up with a monopoly on Chicago's classical radio. "Our ad rates could go up," explains station manager Steve Robinson. And the station's refusal to broadcast jingles, which has cost it advertising revenue, might become less of an issue. "If national advertisers want us to run their jingles, we can say, sorry, our announcers will do the commercials." Schmidt is cautiously optimistic about the future of WFMT. "It will continue to focus on the fine arts, not just classical music. Our niche is local content, what is happening in Chicago. I think our ratings might go up to 2.0, up from the low ones we've been getting. One thing for sure, though--this station is not for sale."
With their big payoff the Florians plan to launch a charitable foundation for the arts, environmental causes, and animal shelters (a testament to their love for cats and dogs); according to Sonia, the possible beneficiaries include "organizations that helped us by placing ads on the station during the lean years," and she names Lyric Opera, Light Opera Works, and Music of the Baroque as some of those music presenters whose offerings she's enjoyed. According to Valerie Lies, president of the Donors Forum of Chicago, if the Florians were to endow a foundation with $100 million, they'd control one of the largest private philanthropic institutions in the city, with an annual budget of at least $5 million. "I feel sad giving up classical broadcasting," says Sonia, "but there are other ways to make a contribution to the local community."